TMI Blog2015 (4) TMI 389X X X X Extracts X X X X X X X X Extracts X X X X ..... to demonstrate that in the costing of the particular product, the cost of capital goods was not taken into consideration. Tribunal has observed that capital goods viz. ESPs have been only used captively for pollution control purpose and the same is not used for processing or manufacturing of any final product and therefore there is no question of passing on the burden of duty to any one. These observations are clearly erroneous in law in view of the judgment of this Court in Indian Farmers Fertilisers COOP. Ltd. - Accordingly, the judgment of the Tribunal is set aside. - Decided in favour of Revenue. - Civil Appeal No. 8359 of 2003 - - - Dated:- 13-3-2015 - A. K. Sikri And Rohinton Fali Nariman,JJ. For the Appellant : Mr. Ashok Panda,Sr.Adv. Mr. Arijit Prasad,Adv.(Argued by) Ms. Sushma Manchanda,Adv. Mr. B. Krishna Prasad,Adv. For the Respondent : Mr. A.K.Chitale,Sr.Adv. Mr. Sumit Kumar Sharma,Adv. Mr. Niraj Sharma,Adv. JUDGMENT A. K. Sikri, J. The issue involved in the present case pertains to the applicability of the doctrine of unjust enrichment in the case of refund of duty paid on 'capital goods' used captively. The factual matrix under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ground that this Court in the said case was not concerned with the issue of unjust enrichment in connection with capital goods used captively. It is in this backdrop the issue, as formulated in the first para above, arises for consideration. Since the judgment Solar Pesticides Pvt. Ltd. has been distinguished and held not applicable to the facts of the present case, we shall start our discussion by analysing the said judgment. In the said case the question which was formulated for decision was as under: Whether the doctrine of unjust enrichment is applicable in respect of raw material imported and consumed in the manufacture of a final product is the question which arises for consideration in these appeals. The Court in detail discussed the principle of unjust enrichment. At the outset it took note of the Constitution Bench judgment in Mafatlal Industries Ltd. and Others vs. Union of India and Others (1997 (5) SCC 536) and the principles laid down therein. Thereafter the position in law on this aspect is succinctly summed up in paras 17 to 20 which are reproduced below: 17 . Section 11-B, along with Section 11-A, was introduced by Customs, Central Excises and Salt a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ebate referred to in Rules 12 and 12A. 19. We may now set out Section 11-B, as amended by Act 40 of 1991. (Even subsequent to 1991, there have been certain minor amendments to the said section.) As it stands today, Section 11-B reads as follows (portions not necessary for the purposes of the present controversy omitted): 11B. Claim for refund of duty.-- (1) Any person claiming refund of any duty of excise may make an application for refund of such duty to the Assistant Commissioner of Central Excise before the expiry of six months from the relevant date in such form and manner as may be prescribed and the application shall be accompanied by such documentary or other evidence including the documents referred to in section 12A as the applicant may furnish to establish that the amount of duty of excise in relation to which such refund is claimed was collected from, or paid by, him and the incidence of such duty had not been passed on by him to any other person: Provided that where an application for refund has been made before the commencement of the Central Excises and Customs Laws (Amendment) Act, 1991, such application shall be deemed to have been made under this sub-sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11-C, besides introducing Section 11-D and an entire new chapter, Chapter II-A. Since Section 11-C does not fall for our consideration, we need not refer to it. Section 11-D reads as follows: 11D. Duties of excise collected from the buyer to be deposited with the Central Government (1) Notwithstanding anything to the contrary contained in any order or direction of the Appellate Tribunal or any court or in any other provision of this Act or the rules made thereunder, every person who has collected any amount from the buyer of any goods in any manner as representing duty of excise, shall forthwith pay the amount so collected to the credit of the Central Government. (2) The amount paid to the credit of the Central Government under subsection (1) shall be adjusted against duty of excise payable by the person on the finalisation of assessment and where any surplus is left after such adjustment, the amount of such surplus shall either be credited to the Fund or, as the case may be, refunded to the person who has borne the incidence of such amount, in accordance with the provisions of section 11B and the relevant date for making an application under that section in such cases shall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents which come into costing of a particular product. Therefore it cannot be said that the principle laid down by the Court in Solar Pesticides would not extend to capital goods which are used in the manufacture of a product and have gone into the costing of the goods. In order to come out of the applicability of the doctrine of unjust enrichment, it therefor becomes necessary for the assessee to demonstrate that in the costing of the particular product, the cost of capital goods was not taken into consideration. We, thus, are of the opinion that the view taken by the Tribunal is not correct in law. We also find from the reading of the judgment of Tribunal that the Tribunal has observed that capital goods viz. ESPs have been only used captively for pollution control purpose and the same is not used for processing or manufacturing of any final product and therefore there is no question of passing on the burden of duty to any one. These observations are clearly erroneous in law in view of the judgment of this Court in Indian Farmers Fertilisers COOP. Ltd. Accordingly, the judgment of the Tribunal is set aside. However, in the facts of the present case we are of the opinion that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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